Derma Sciences Reaches New 52 Week High with over a 100% Increase in Stock Price Since July 09'

Derma Sciences (DSCI.OB) Reaches new 52-Week High on Monday, September 21st 2009. Since early July, Stock Price has Increased Over 100% Leader in Advanced and Traditional Wound Care with Total Revenues to approach $50M in Fiscal Year 09'

Corporate Overview

Derma Sciences develops, manufactures, and markets wound care products that include:

• Advanced Wound Care for the treatment of chronic and non-healing wounds and burns.
• Traditional Wound Care, which includes gauze bandages and surgical dressings.
• First Aid Products for hospitals and consumer markets as well as first aid kit supplies.

 
The Company’s primary focus is on the following:

1. Active dressings to assist in treatment of the most difficult wounds, including their proprietary line of MEDIHONEY® dressings.
2. DSC127, a novel patented topical drug for accelerated healing and scar prevention, currently in a Phase II Diabetic Foot Ulcer trial.

 
Investment Highlights

• The Company’s Advanced Wound Care Products are at a current run rate approaching $10 million in revenue, including annualized MEDIHONEY revenues approaching $3 million with a gross margin of 70%.
• Phase II results for the DSC127 Diabetic Ulcer trial are scheduled for release in early Q3 of 2010.  Strong clinical outcomes from the trial could create a significant valuation milestone for DSCI shareholders.
• Total revenues are expected to exceed $50 million in 2009, including revenues from the introduction of four new advanced wound care products since Q4 2008.
• Recent valuation of DSCI has been only 1/3 of revenues in a company with successful new product launches, a strong novel pharmaceutical candidate well into a Phase II trial, and $18 million dollars in gross profit to help support growth initiatives.

         
Drug Under Development
DSC127, developed at the University of Southern California, is an analog of a naturally occurring peptide, angiotensin. Extensive pre-clinical studies have demonstrated the efficacy of the compound in accelerating healing and reducing scar formation.  DSC127 is currently enrolling patients in its Phase II trial.  Enrollment into the Phase II study is expected to be completed by the end of 2009, with results expected to be reported in Q3 of 2010.
 
Indications being considered for DSC127 include:

• Diabetic foot ulcers
• Venous leg ulcers
• Arterial Ulcers
• Pressure Ulcers
• Burns (Thermal & Chemical)
• Scar Prevention

 
Key Products
MEDIHONEY dressings are a unique line of products containing active Leptospermum honey from New Zealand and Australia. This particular type of honey has been shown to possess unique plant-derived antimicrobial and immunomodulatory qualities that make it ideal for the management of chronic wounds and burns.  The products are currently sold into the medical market, and dressings to be sold at the retail level are under development for launch in 2010.  The patent-protected dressings contain a high percentage of honey, enabling them to work effectively in the presence of wound fluid, blood, and tissue, promoting an optimal healing environment.
 
Derma Sciences has a partnership with Comvita, a company located in New Zealand, which controls 75% of the production of Leptospermum honey and has strong IP around the dressing configurations. Derma Sciences currently has exclusive rights for MEDIHONEY in the Americas and is working towards worldwide rights.
 
Dressings are indicated for the management of moderate to heavily exuding wounds such as:

• Diabetic foot ulcers
• Venous stasis leg ulcers
• Arterial leg ulcers
• Leg ulcers of mixed etiology
• Pressure ulcers (I-IV)
• 1st & 2nd degree burns
• Donor sites
• Traumatic and surgical wounds

 
BIOGUARD™ is line of patented antimicrobial barrier gauze dressings, which received FDA clearance in Q1 2009. BIOGUARD dressings have been shown to achieve a greater than 99.99% kill of a broad range of bacteria, including MRSA, in under an hour.  Resistance to the dressings is almost impossible, as the active antimicrobial is intrinsically bound to the base dressing, ensuring proper microbicidal concentration.  This uniquely makes the BIOGUARD line of dressings ideal for preventative usage.

XTRASORB™ is a novel absorptive dressing with a super-absorbent polymer at its core.  While other absorbent dressings rely on spaces to fill with fluid, XTRASORB’s polymer binds to fluid and converts to a gel.  This allows XTRASORB dressings to retain up to 88% more of previously absorbed fluid than other absorbent dressings, helping to reduce maceration and keeping harmful components found in wound fluid away from the wound bed.